America: Freedom to Fascism

America: Freedom to Fascism is a 2006 American film by filmmaker and activist Aaron Russo, covering a variety of subjects that Russo contends are detrimental to Americans. Topics include the Internal Revenue Service (IRS), the income tax, Federal Reserve System, national ID cards (REAL ID Act), human implanted RFID tags, Diebold electronic voting machines, globalization, Big Brother, taser weapons abuse, and the use of terrorism by the government as a means to diminish the citizens' rights. The film has been criticized for its promotion of conspiracy theories, its copious factual errors, and its repeated misrepresentations of the individuals and views it purports to criticize.

The film examines the genesis and functions of the Federal Reserve System. The film asserts that the Federal Reserve System is a system of privately held, for profit corporations, not a government agency, and that the Fed was commissioned to print fiat money on behalf of the federal government, at a fee ultimately paid for by the personal income tax (through service on bond interest). The film also refers to the fact that the United States dollar is not backed by gold, and states that this means the dollar has no real backing other than future income tax payments. Consequently, the film states that Federal Reserve Notes represent debt instead of wealth. The film argues that the Federal Reserve System manipulates what is sometimes referred to as the business cycle of economic expansion and retraction by putting new notes into circulation to increase the ease of obtaining credit, which devalues the currency, then compounds inflation by increasing interest (prime) rates. The movie argues that this manipulation is responsible for a 96% devaluation of American currency, since it was made possible to increasingly sever the link with gold backing by the Federal Reserve Act of 1913. The film says that this process of creating new money and adding it to the money supply is known as debasement and is a cause of inflation. In this way, the film concludes that the Federal Reserve System simultaneously controls the supply of money and its value. The central thesis of the film may be that this monetary policy is the strongest form of governance that has ever existed, and is central to the unconstitutional, global power ambitions of the interests that supposedly control the Federal Reserve System. The film also asserts that the private interests are controlling the Federal Reserve System, and have been for generations. The film proposes that most Americans are kept ignorant of how the Federal Reserve operates through actions of corrupt politicians and an increasingly centralized media. By using what the film calls legalistic and economic "mumbo jumbo” terms such as 'monetizing the debt' or ‘adjusting monetary policy for increased fluidity of credit’, these interests, according to the film, conceal the true actions of the Fed behind veils of legitimacy. Interviews are conducted with several organizations and elected legislators who support these views. An argument made in the film is that there is no reason why the Federal Reserve System should have a monopoly on the U. S. money supply. The film asserts that "America got along just fine before the Federal Reserve came into existence." This leads the film to the question of why the Federal Reserve System was created. The film contends that the U. S. Congress has no control or oversight over the Fed, and hence has no control over the value of U. S. money. The film argues that Congressional control over the value of money is required by Article 1, Section 8 of the United States Constitution. The phrase in question (clause 5) states that the United States Congress shall have the power "To coin Money, regulate the Value thereof, and of foreign Coin "

The film includes a call to action to abolish the Federal Reserve. In 2007, The Boston Globe stated that Congressman Ron Paul, "says he doesn't agree with all the film's arguments, but he says the film had 'a huge impact' on the support his campaign is drawing", a reference to Paul's presidential bid in 2007 and 2008.

Through interviews with various individuals including former IRS agents, Russo sets forth the tax protester argument that, "there is no law requiring an income tax", and that the personal income tax is illegally enforced to support the activities of the Federal Reserve System. One of the listed stars of the film, Irwin Schiff, was sentenced on February 24, 2006 to 13 years and 7 months in prison for tax evasion and ordered to pay over $4.2 million in restitution. In pre sentencing documents filed with the court, Schiff's lawyers had argued that he had a mental disorder related to his beliefs about taxation. Initially, the film portrays Schiff as a tax expert, though his qualifications and those of many other individuals in the film are not mentioned. Later in the film, Russo reveals that Schiff has been imprisoned. Schiff appears in the film for another reason as well. The filmmaker lampoons Judge Kent Dawson's reaction to Schiff's defense. The film alleges that the judge "denied Irwin the ability to prove to a jury that there was no law requiring Americans to file an income tax return. He denied Irwin the right to attempt to prove to a jury there was no law  by stating, 'I will not allow the law in my courtroom.'" At 0:48:28 of the film, Russo introduces the judge and his statement. Under the U. S. legal system, the general rule is that neither side in a civil or criminal case is allowed to try to prove to the jury what the law is. For example, in a murder case the defendant is not generally allowed to persuade the jury that there is no law against murder, or to try to interpret the law for the jury. Likewise, the prosecution is not allowed to try to persuade the jury about what the law is, or how it should be interpreted. Disagreements about what the law is; are argued by both sides before the judge, who then makes a ruling. Prior to jury deliberations, the judge, and only the judge, instructs the jury on the law. Another listed star, Vernice Kuglin, was acquitted in her criminal trial for tax evasion in August 2003. This means she was not found guilty of a willful intent to evade income taxes. (A conviction for tax evasion requires, among other things, proof by the government that the defendant engaged in one or more affirmative acts of misleading the government or of hiding income.) Kuglin's acquittal did not relieve her of liability for the taxes. Kuglin entered a settlement with the government in 2004 in which she agreed to pay over $500,000 in taxes and penalties. On April 30, 2007, the Memphis Daily News reported that Kuglin's Federal tax problems continued with the filing of a notice of Federal tax lien in the amount of $188,025. The Memphis newspaper also stated that Kuglin has "given up her fight against paying taxes, according to a Sept. 10, 2004, Commercial Appeal story." The preview clip for the film includes assertions contradicted by official government publications regarding the activities and nature of such institutions as the Internal Revenue Service and the Federal Reserve System.

The film refers to both article 1 section 8 of the U. S. Constitution, which grants Congress the authority to impose taxes, and disputes the legitimacy of the Sixteenth Amendment (see Tax protester Sixteenth Amendment arguments), which removes any apportionment requirement.

As of late July 2006, Aaron Russo's biography on his website for the film stated: "The film is an exposé of the Internal Revenue Service, and proves conclusively there is no law requiring an American citizen to pay a direct unapportioned Tax on their labor." The New York Times article of July 31, 2006, states that when Russo asked IRS spokesman Anthony Burke for the law requiring payment of income taxes on wages and was provided a link to various documents including title 26 of the United States Code (the Internal Revenue Code), filmmaker Russo denied that title 26 was the law, contending that it consisted only of IRS "regulations" and had not been enacted by Congress. The article reports that in an interview in late July 2006, Russo claimed he was confident on this point. In the United States, statutes are enacted by Congress, and regulations are promulgated by the executive branch of government to implement the statutes. Statutes are found in the United States Code and regulations are found in the Code of Federal Regulations. The Treasury regulations to which Russo may have been referring are found at title 26 ("Internal Revenue") of the Code of Federal Regulations, not title 26 of the United States Code. The argument that the Internal Revenue Code is not law, the argument that the Internal Revenue Code is not "positive law," and variations of these arguments, have been officially identified as legally frivolous Federal tax return positions for purposes of the $5,000 frivolous tax return penalty imposed under Internal Revenue Code section 6702(a). The article also discloses that Russo had over $2 million of tax liens filed against him by the Internal Revenue Service, the state of California, and the state of New York for unpaid taxes. In an interview with The New York Times; however, Russo refused to discuss the liens, saying they were not relevant to his film.

Aaron Russo reads a quote attributed to U. S. District Judge James C. Fox:

If you  examined [The 16th Amendment] carefully, you would find that a sufficient number of states never ratified that amendment. The film does not mention the specific court case, which is Sullivan v. United States in the United States District Court for the Eastern District of North Carolina, case no. 03 CV 39 (2003). In the case, the plaintiffs attempted unsuccessfully to prevent the deployment of troops to Iraq. The comments with respect to the Sixteenth Amendment did not constitute a ruling in the case (see Stare decisis) and were mentioned only in passing (see Obiter dictum). The transcript reads (in part):

I will say I think, you know, colonel, I have to tell you that there are cases where a long course of history in fact does change the Constitution, and I can think of one instance. I believe I'm correct on this. I think if you were to go back and try to find and review the ratification of the 16th amendment, which was the internal revenue, income tax, I think if you went back and examined that carefully, you would find that a sufficient number of states never ratified that amendment  And nonetheless, I think it's fair to say that it is part of the Constitution of the United States, and I don't think any court would ever set it aside.

A review by The New York Times stated that "examination of the assertions in Russo’s documentary, which purports to expose 'two frauds' perpetrated by the federal government, taxing wages and creating the Federal Reserve to coin money, shows that they too collapse under the weight of fact."